Ayushi Asked a Question
August 10, 2020 6:12 pmpts 30 pts
2 Consider the following matrix which describes the respective strategies and the corresponding payoffs of firms A and B operating in a duopoly Firm B Advertise Don't Advertise Advertise 11,6 16, 0 Firm A Don't Advertise 7,9 20, 2 Which of the following statement(s) is/are true for the above game ? Select the correct answer from the codes given below (a) Firm A has no dominant strategy. (b) Firm B has a dominant strategy. (C) The game has a Nash equilibrium. (d) Neither Firm A nor Firm B has a dominant strategy. Code (1) (a), (c) (2) (b), (c) (3) (d) Only (4) (a), (b) and (c)
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  • Nidhi taparia Best Answer
    The correct code is (4), because options a, b and c are correct. Let's see why. First of all please refer to the image to see the payoff matrices of each A and B firms. a is corr...
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    • cropped7808669437829550936.jpg
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